Google Merges European Operations To Square Up To Regulators And Rivals

United we stand, divided we fall. So goes the old saying that search and mobile giant Google is now taking to heart in Europe, as it faces off with regulators and rivals in the region. The company is merging its European regional and product operations into a single unit, to be led by Matt Brittin, formerly the head of Google’s operations in northern and western Europe, who now becomes EMEA President.

Carlo D’Asaro Biondo, who had been in charge of southern and eastern European business, will now lead on commercial partnerships across the bigger region.

The announcement was made at a presentation in Brussels, home of the European Commission, and one big sign of where Google is hoping the news will have an impact. The FT also reported news of the change yesterday evening.

The changes will help Google manage pan-European operations more easily — providing single points of contact for business partners doing business with Google in Europe — but it will also mean that Google will be able to provide more unified resources to cope with country-specific problems that come up on the regulatory front.

For its part, Google is also presenting the move as its own way of endorsing the Commission’s bigger push for single-market regulations, which essentially means a set of rules and administrative practices that will be consistent across all of Europe.

The company followed up moments ago with a blog post presenting the soft diplomacy side of the news. It is committing €25 million for digital skills training for small businesses, covering 1 million people, by 2016. “We’ll build a Europe-wide training hub to support businesses anywhere in Europe to get training online,” Brittin writes. There is also a video showcasing some of the inspiring ways that Google has already done this. We can’t bring ourselves to put it in here as it’s too much of a blatant commercial.

The split operations were first put in place years ago by former Google executive Nikesh Arora in a very Machiavellian move: the idea had been to divide operations so that regions would compete against each other more keenly, according to the FT.

These days, Google’s bigger competitive threat is coming in another form: regulators are going after the company from a number of angles, being propelled in part by an angry mob of businesses and consumers.

The list of challenges that Google is facing in Europe include accusations of Google being anticompetitive both in search; and in mobile (Android is by far the biggest mobile operating system, with share of over 80% in some markets). The company is also being probed on how it handles privacy issues — with new issues in data protection seemingly growing by the day.

The search case is particularly thorny one. Google dominates search in Europe, and it has been the subject of a long-running antitrust case lobbied by businesses that claim that Google has created an unfair advantage for itself in different categories of “vertical search” — that is, searches for results in specific areas like travel and news. Last year it looked like Google might actually get off the hook with relatively little impact, although the case then got reopened with deeper scrutiny.

Sources tell us that the latest on this is that Google’s chairman Eric Schmidt will be meeting with Margrethe Vestager, the new antitrust commissioner, next week to discuss the case.

On the side of more commercial problems, Google itself is not immune to encroaching competition, even as it dominates in search and mobile. One big area where it has fallen flat has been social, and while no one may ever beat Google at search, you have to wonder if at some point the goal posts may simply just change.

“Just talking with publishers the other day, many get most of their traffic from Facebook or Twitter, not from Google,” Brittin told the Financial Times. “We’re in a world where the dynamics and competition is speeding up.”

Put simply, bringing the company together in Europe is about presenting a unified front.

Search de-listing of personal data

One of the biggest areas where Google has been coming under pressure in Europe is last year’s so-called ‘right to be forgotten’ ruling by Europe’s top court, the ECJ.

As background, the court determined that search engines are data controllers and therefore subject to European data protection legislation. Specifically it requires search engines to process URL de-listing requests from private individuals, when incorrect, out of date or no longer relevant information is foregrounded in the search results that are served for their name.

Google holds a massively dominant share of the search market in Europe so the ECJ’s ruling weighs most heavily on its business. Last year it set up an online form where individuals can make de-listing requests but it has continued lobbying hard against the ruling, characterizing it as ‘censorship’.

One complication is that the ruling requires search engines to weigh up and balance any public interest before agreeing to a de-listing request, so complex value judgements are required. This means case by case processing of individual requests — rather than the kind of algorithmic automation Google is so fond of.

The principle of a search de-listing right for personal data in Europe stands in obvious opposition to Google’s general business imperatives to gather as much data as possible on its users so it can improve advert targeting. But there’s an added fight for Google with European search de-listing because its current implementation of the law goes against the guidelines of Europe’s data protection watchdogs.

They want Google to de-list across the domain, not just the European sub-domains as it currently is. And, earlier this month, France’s national data protection authority told TechCrunch it will be requesting that Google implements worldwide de-listing — noting that it has powers to impose penalties for non-compliance by Google.

The European Commission is also the process of updating and harmonizing its data protection rules — with a new data protection directive being negotiated. The new rules, which will bring strictly penalties for non-compliance, are expected to be agreed by the end of this year.